High Price of Gold Disrupting International Love
The price of gold is up 26% for the year so far. Overall, the price increase is beginning to change investor portfolios, as more people consider buying gold and other precious metals. However, the hike in gold prices is also starting to influence governments and cultures all over the world, from Japan scouring the ocean floor for gold to Egypt changing its long-held marriage rites.
Should’ve put a Ring on it
According to an Egyptian marriage tradition known as “shabka,” a groom is expected to buy an apartment and pay a dowry for the hand of his future wife. He’s also expected to bring the bling in the form of gold jewelry. However, this long time tradition may be changing due to the rise in gold prices. Many Egyptian grooms are complaining of the financial hardships of shelling out for non-practical items such as jewelry.
According to a BBC article, the “price for one gram of 21-carat gold has reached 445 Egyptian pounds,” (around $50 USD) at the time of the writing. This may seem like a trifle, but the Egyptian yearly median income is around $70,000 EGP. If the average Egyptian groom bought their intended just one simple 21-carat band weighing 10 grams, they would be spending more than 6% of their annual income.
A campaign against the shabka tradition is gaining support in Egypt, with some suggesting grooms buy silver as a substitute.
India Weddings Boon for Gold
As the second largest gold consumer on the planet (China is first), India is anticipating a big jump in gold sales with the start of the wedding season. In the last half of the year, festivals like Dhanteras take place which is a time for celebrating wealth. The December quarter usually “accounts for about a third of India’s gold sales.”
Currently, India has seen gold imports fall with the higher prices, but analysists expect wedding festivals and cultural events surrounding gold to jumpstart the country’s insatiable desire for the yellow metal. Low demand has been accompanied by record discounts and a rise in smuggling and scrapping of gold, according to The Times of India.
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